| Title | AMD Misses Q1 Earnings Target; Withdraws from High-Density Server Market | |
| Date | Saturday April 18 2015, @04:44AM | |
| Author | martyb | |
| Topic | ||
| from the trying-to-turn-the-tide dept. | ||
Two stories regarding chipmaker AMD in the news today. First, they missed their Q1 earnings target, after reporting losses of $180 million, or $0.23/share:
Revenue landed at $1.03 billion, down 26 percent on the year-ago quarter (statement) ...Non-GAAP earnings were a loss of 9 cents per share ...Wall Street was expecting a loss of 5 cents per share on revenue on $1.05 billion.
"Under the backdrop of a challenging PC environment, we are focused on improving our near-term financial results and delivering a stronger second half of the year based on completing our work to rebalance channel inventories and shipping strong new products," [said AMD chief executive Lisa Su].
Secondly, AMD is withdrawing from the high-density server business, reversing a strategy that began 3 years ago with the acquisition of SeaMicro:
AMD paid $334 million to buy SeaMicro, which developed a new type of high-density server aimed at large-scale cloud and Internet service providers ...The purchase was made under former CEO Rory Read, and has now been reversed by Lisa Su, who took over the CEO job last October ...AMD said the move is part of its effort to "simplify and sharpen" its investment focus. As a result, it is taking a charge of $75 million.
AMD still sees growth potential in the server market, but not from selling complete systems. It's returned its focus to x86 chips and to the development of its first ARM server processor, code-named Seattle.
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